Newell Gears Up for Q1 Earnings: What You Should Know About the Stock?

Newell Brands Inc. NWL is expected to register a year-over-year decline in the top and bottom lines when it reports first-quarter 2025 results on April 30, 2025, before the opening bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.55 billion, indicating a drop of 6.4% from the figure reported in the year-ago quarter.

The consensus estimate for the bottom line is pegged at a loss of seven cents per share, which indicates a decline from break-even earnings reported in the year-ago quarter. The consensus mark has been stable in the past 30 days. 

In the last reported quarter, the Atlanta, GA-based company’s earnings surpassed the Zacks Consensus Estimate by 14.3%. Its bottom line beat the consensus estimate by 46.4%, on average, in the trailing four quarters.

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Factors Likely to Impact NWL’s Q1 Results

Newell has been battling a tough macroeconomic landscape. The company’s quarterly performance is likely to have been hurt by elevated levels of core inflation that is expected to have led to muted demand for discretionary and durable products. Foreign currency translations and adverse impacts of business exits are expected to have been headwinds.

In addition, shifting consumer preferences, challenging operating environment, soft demand, rapidly evolving retail and consumer landscape and the impacts of geopolitical volatility have been acting as deterrents. Sluggishness in its Outdoor & Recreation segment has also been a concern.

Management, in its last earnings call, had expected net sales to decline 5-8%, with core sales anticipated to drop 2-4% for the first quarter of 2025. The company had projected a normalized operating margin of 2-4% for the first quarter, down from the 4.8% reported in the prior-year quarter. 

NWL had envisioned a normalized loss of seven-nine cents per share in the first quarter against break-even earnings per share (EPS) in the year-ago quarter. We expect a first-quarter normalized operating margin of 3.7%. Our model expects a net sales drop of 12.2% in the Outdoor & Recreation segment.

On the positive front, Newell’s front-end commercial capabilities, mainly innovation and business development, coupled with a more streamlined organizational structure, appear encouraging. This, coupled with pricing across the international markets to offset inflation and currency fluctuations, is likely to have offered a cushion to the company’s performance during the quarter under review.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Newell this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Newell currently has an Earnings ESP of -2.44% and a Zacks Rank #4 (Sell).

Valuation Picture

From a valuation perspective, Newell offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 7.39x, which is below the five-year high of 16.88x and the Consumer Products - Staples industry’s average of 20.94x, the stock offers compelling value for investors seeking exposure to the sector.

The recent market movements show that NWL’s shares have lost 40.2% in the past six months against the industry's 0.4% growth.

Stocks With the Favorable Combination

Here are some companies, which according to our model, have the right combination of elements to beat on earnings this reporting cycle.

The Estée Lauder Companies Inc. EL currently has an Earnings ESP of +14.31% and a Zacks Rank of 3. The Zacks Consensus Estimate for third-quarter fiscal 2025 EPS is pegged at 30 cents, which implies a 69.1% decrease year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for Estée Lauder Companies’ quarterly revenues has fallen a penny in the past 30 days to $3.51 billion, which indicates a 10.9% decrease from the figure reported in the prior-year quarter. EL delivered a trailing four-quarter earnings surprise of 101.9%, on average.
 
Church & Dwight Co. CHD has an Earnings ESP of +0.66% and a Zacks Rank of 3 at present. CHD is likely to register top-line growth when it releases first-quarter 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $1.51 billion, which implies growth of 0.5% from the figure reported in the year-ago quarter.

The consensus estimate for Church & Dwight’s quarterly earnings has remained unchanged in the past 30 days at 89 cents per share, implying a decline of 7.3% from the year-ago quarter’s number. CHD delivered an earnings surprise of 9.6%, on average, in the trailing four quarters.

Hershey HSY currently has an Earnings ESP of +0.10% and a Zacks Rank of 3. HSY is anticipated to register top and bottom-line declines when it reports first-quarter 2025 results. The Zacks Consensus Estimate for Hershey’s quarterly revenues is pegged at $2.82 billion, indicating a drop of 13.3% from the figure reported in the year-ago quarter. 

The consensus estimate for Hershey’s earnings has fallen a couple of cents in the past 30 days to $1.94 per share. The consensus estimate indicates a plunge of 36.8% from the year-ago quarter’s reported figure. HSY has delivered an earnings beat of 1.7%, on average, in the trailing four quarters.

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This article originally published on Zacks Investment Research (zacks.com).

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